Market on holiday mood

The KLSE had been on a quiet mood over the last week due to the many holidays. The KLCI continued with its down slides earlier part of the week as a continuation from the previous week's fall. As mentioned in the last post, CI gone down to 1382.44 to close the gap that was created on the 30th Nov due to the listing of Sime Darby. CI closed the week above the 1400 psychological level at 1403.56, however, the volume was low, averaging about 600+ million daily which is not very encouraging, probably due to the holiday mood.

This is a good time to take a rest and review the trading results over the last one year. Be truthful to ourself when reviewing, look back at the mistakes that we made and make an improvement on it. Share trading is a learning journey, one can improve his trading skill over time, provided that the person is always willing to review his / her own mistakes, learn from it.

I take this opportunity to wish every one a better and profitable 2008, Merry Christmas and Happy New Year!

Weak market, correction downward

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The KLCI closed weak at 1403.41 on last Friday(141207) after it hit the record high of 1449.70 a week ago. It was down 30.63 points week-on-week. Market players took the opportunity to lock in their profits. Stock markets worldwide was down since 121207 due to a rate cut by FED that was lower than what was anticipated by the market. Daily volume of Bursa Malaysia has shrunk to around 600 to 700 million shares, which is a bad sign indicating a weak market, and more correction ahead is anticipated. In view that 1423 did not hold, and CI actually penetrated 1400 to the low of 1396.45 before a last minute push up to close at 1403.41, KLCI may further correct downward to the 1380 level to close the Gap that was created due to the listing of Sime Darby. Strong support may be found around 1350 and 1330 level. If these two level could not hold, then the KLCI will actually turn into bear phase. Hopefully the year end window dressing activities could help CI maintain at the current level.

Stock wise, there aren't many stocks that are good for trading. Some of the strongly trending stocks are BJCorp, BJCop-LC, and BJland. Gamuda shows a strong reversal up due to the revival of the double-tracking project, with a potential target of 5.10.



To all my Muslim readers, I wish all of you Selamat Hari Raya Haji; and to my Christian readers, Merry Christmas.





Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.

KLCI lacking participation

The KLCI started Friday(071207) with a positive mood, the CI touched the record high of 1449.70 within the first twenty minutes of the session, and thereafter profit taking sets in and sent the CI down to the low of the day at 1431.77, an 18 points retracement from the peak but closed off low at 1434.04 (-6.35, -0.44%). Losers outnumbered gainers with 542 to 275. Volume traded was weak at only 790 million shares, this clearly indicates the local market lacks participation from the mass retailers, the CI's gain over the last few days was merely due to the gain in a few heavy weights.

Technically, Friday's price action has lead to the formation of a bearish engulfing candlestick which indicates distribution, especially happening near the top. The KLCI may continue to retrace downward to the 1423 level, which may provides support for the immediate term. For the medium term the 1400 psychological support is important. For the long term, our KLCI is still on the uptrend. Base on the trend channel, we are looking at the very possible target of 1500, this target may be achieved by the first quarter of 2008.

Some of the stocks that may offer short term trading opportunity are Kianjoo and Pohkong.
















Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action

Marching towards 1450

I mentioned in the post on 291107, "hopefully the listing of SD (now SIME) will kick-off a new round of rally", it is now coming true, thanks to the heavy weight counter. Our KLCI started Wednesday (051207) with a slight dip to 1415 due to Dow's overnight fall of 65 points, and very quickly CI shrugged off the fear and march towards 1423, the previous all time high. The attempt to break the record high was finally successful at 3.30 pm and CI reached a high of 1431.69 intraday, and finally settled at 1427.77 (+11.96, +0.84%). Market breadth was strong with 602 gainers against 241 losers, and volume was mild at just about 1 billion shares traded.

With the CI breaking through 1423, we are seeing the high possibility that KLCI will march towards 1450 before we say bye-bye to 2007. While the heavy weights are leading the way, the second and third liners are also showing signs of reversal after almost one month of correction. Some of the counters worth watching are MPHB, JAKS, Sunway-WB and Dataprp.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.

KLCI up, but market was actually down

The listing of Sime Darby (or Synergy Drive as mentioned previously) on Friday, 301107, actually lifted the CI to open at 1408.09, a 33.77 points up. However, the CI did not continue with the up move, it only managed to climb to the intraday high of 1408.32, and thereafter was heading south direction to hit the low of 1391.72 and finally closed at 1396.98, up 22.66 points. The KLCI was up, but in actual fact the market was down, reason being Sime Darby alone, being the largest market capitalization counter on the Bursa Malaysia has contributed 23.40 points gains to the KLCI with its Rm2.10 gain. If we take away the contribution by SIME, the KLCI actually closed at 1373.58 (-0.74). Technically speaking, the candlestick formation coupled with a gap on Friday was not a good sign, despite the fact that CI was up, the general market actually took opportunity to take profit (or sell on strength), the confidence was not there yet. The general market sentiment was actually weak on Friday with majority of the counters down, losers lead gainers with 469 to 339, and volume done was only 970 million shares which indicates the general market lacks enthusiasm. Hence, CI may continue to slide down back into the sideway consolidation mode.

On the regional side, Hong Kong's HSI was back above the 28000 mark, and Singapore's STI has also climb back above the 3500 mark. These two marks was important for the respective indexes.













As for the DJI, it continued with its rebound from the recent low of 12,724 to close at 13,442. DJI may face some resistance at the 13,500 to 13,600 level.





From the movement of the indexes, most markets will move into the sideway consolidation phase, maybe this is a time to take a rest.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.

Consolidation

In response to the overnight 215 points gain of the DJI, our KLCI started Wednesday with a 3 points gap up on opening and hit a intraday high of 1373, and profit taking sets in quickly. KLCI has been maintaining in the positive zone most of the day. At about 3.30 pm, the market took a dip as a result of the "limit-down" action of a few speculative stocks. The actions really affected sentiment of the general market at a time like this, where the market is just trying to recover from the recent correction. However, the magic hand is there doing his job and closed the KLCI at 1366.58, with 1.59 points gain. Market breadth remains weak with 297 gainers and 556 losers, volume is back to 1 billion share level. As mentioned previously, our market is consolidating at the current level with a trading range of between 1340 - 1380. The general market will only regain activeness if only the KLCI can goes above 1380.

Majority of the regional markets have also moved into the base building consolidation phase except Shanghai index (SSEC), where it has just broken the 120 days MA support, and may go further down to test the support at 4335.

The bulls on the DJI are fighting back, and the index has rise about 545 points over two days to bring the DJI above the 13,000 mark, back to the uptrend channel and above the 200 days long term MA. The bull may meet some strong resistance around the 13,500 level. Whatever it is, at least the Dow is back on track, and may goes into a consolidation phase between 13,000 - 13,550.

The sentiment of our local market was really affected by the plunge of the RL group of stocks, taking the lead was ETITECH, COMINTL, OILCORP, and KBES. If one wants to play these kind of stocks, one must always be happy with the profit when one have it, don't try to take every drop out of it, then one may end up giving everything back and may even get roasted.

The plantation sector remain steady in anticipation of the listing of Synergy Drive tomorrow, hopefully SD will lift the sentiment of the market and kick-off a new round of rally. Some of the plantation stocks that are worth watching are Twsplnt, Kretam, Cepat and Harnlen.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is solely your own responsibility. Do consult your dealer before taking any action.

Taking a breather

Our KLCI had on last Friday (231107) mainly stayed in a range bound trading condition with CI fluctuating between 1345 and 1354 and close the day near the high at 1353.55, however, it never goes below the close on Thursday of 1344.16. Volume shrunk to a low 630 million shares which indicate a lack of interest. Gainers lead losers with 464 against 287. After 3 weeks since the correction started on 1st November, the KLCI has came down from its peak of 1423.81 to the 120 days MA support at 1340. If this support holds well, KLCI may take a breather from its recent correction and move into sideway consolidation with a range between 1340 and 1380. Hopefully the listing of Synergy Drive on the 30th November will bring some life to the market.

For the Singapore STI, it is also showing a temporary bottom signal with the low of 3306.53. STI will also goes into a sideway market with a range of between 3300 and 3500




The Hang Seng Index has also seen a temporary bottom at 25861. It may swing between 25500 and 28000 points






As for the Dow Jones Industrial Average (DJI), it closed last Friday at 12980.88 with a green Marubozu candle, indicating that the bulls are in control the whole day, trying to fight back to bring the index back near the 13000 level. Whether the bull will succeed in their attempt is really critical for the Dow, we will find out tonight.


Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.

Update

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Regional bourses all open with a panic gap down on Tuesday morning following the falls of 218 points on DJI on Monday which closed at 12958, below the 13000 psychological support, this really cause the regional market to jitter, hence, the panic gap down opening. However, one can observed that the downward selling pressure did not last and the bull was fighting in the afternoon session. HSI and STI closed the day with a bullish reversal candle. HSI will have to go back above 28000 to maintain the medium term uptrend, and STI will have to go above 3500 to keep its long term uptrend intact. As for our KLCI, we lack a bit of strength, and closed the day off low at 1371.70 (-8.21, -0.59%) to form a bottom reversal black Hammer candlestick. Whatever it is, KLCI is now stuck in a sideway trading range of between 1360 - 1400, hopefully the listing of Synergy Drive will bring the KLCI above 1400, and that will bring life to our market again.















The DJI has on last night seen a roller coaster ride with the bull winning the battle for the day to close Tuesday at 13010, and the psychological support of 13000 was temporary defended. This also keep the DJI within the uptrend channel which must be defended, otherwise the whole world will purge.



Some of the stocks that may offer short term trading opportunities are CBSTech, GPlus and Tanco. However, one must be quick in taking the profit when you see it.


















Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.

Sideways

Last Friday(161107) was generally a down day with the KLCI trading in the red zone most part of the day. Regional market was generally down with HSI taking the lead with a fall of 1100 points, a result of the Chinese government curbing the underground currency exchange activities. The KLCI actually showed mild selling pressure with the CI hitting a low of 1377.43 intra-day and closed at 1386.64 (-3.36, -0.24%) with a last minute magical touch, volume reduced to 1.01 billion shares with losers (519) outnumbered gainers (276), forming a Doji candlestick. The Doji formation indicated that the market (CI) is uncertain of its direction, however, the price action for the day showed that the magic-hand is trying to maintain the KLCI above the 1380 level. For the moment, KLCI is finding good support around the short term 27 days MA, the medium term 50 days MA is coming to meet the short term MA, and the long medium term 120 days MA has gone flat indicating that the market is probably going into a sideway condition in the short to medium term. The long term 200 days MA, however, is still pointing northeast indicating that the long term trend of KLCI is still up. Looks like the market is taking a breather while waiting for a catalyst to move it further, probably the listing of Synergy Drive at the month end.

As for the DJI, it is probably trying to find a base around the current level of 13000 to 13400 amidst the many troubles the US economy is facing. As mentioned in the previous posts, the 13000 level is critically important for the DJI to defend in order to maintain its medium to long term uptrend.


Back to our local market, some of the stocks that we are following such as BHIC, KNM, MPHB, and MPCorp, the uptrend is still intact. MPHB will be suspended till Wednesday awaiting the result of the announcement on its intention to privatize Magnum.

Maybulk, Landmrk, BJCorp, Kretam and a few other plantation stocks have gone into a short term sideway consolidation. Their medium to long term uptrend is still intact.

Time and Timecom may offer short term trading opportunity as a result of the positive development between Timecom and Digi.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.

Temporary bottom

The market has been bearish for the last few days as a spill over effect of the Dow's poor performance, however, our KLCI has been showing good resilience. As usual, the market started off the day with a slight positive sentiment with the CI registering the days high of 1385.89 within the first half an hour, thereafter, it went into the red territory hitting the low of 1370.33 and made a "u" turn upward after 3 pm, and as usual the magic hand brings the CI to close at 1383.43 (+1.08, +0.078%) forming a bottom reversal candlestick known as Hammer. From the chart, one can see that our CI is finding good support around the 1380 level, the market breadth of 420 gainers to 388 losers shows that the KLSE is not at all that bearish, in fact many counters such as KBES, MPHB, CBSTECH are showing signs that they can't wait to go up. Well, as the saying, "what goes up must come down, and what came down will go up too", that is how the market works. The broad trend of the KLCI is still up, the present is only a minor correction within a major uptrend. The market may go "yo-yo" between 1380 and 1413 to build a base before it climb further up, however, I believe that with the good effort of the whole nation our KLCI will continue to move up, slowly but steadily because Malaysia boleh.

On the regional side, Hang Seng Index (HSI) also showed the formation of a Hammer-like bottom reversal candlestick. From the chart one can see the immediate support of the HSI on the 50 day MA. The next major support for the HSI is around 26500, if this level can't hold, then the HSI will really turn bear. HSI's volatility is really different from that of KLCI, one must learn to get used to it. It is just like going to Indonesia, one must get used to the juta (million) of Rupiah that one carries, don't be nervours.

As for the DJI, it is showing a bullish Engulfing bottom reversal candlestick, the bulls are fighting back. As mentioned in the previous post, the 12950 level must be defended for the uptrend to be maintained, it did. With this, I believe a temporary bottom is formed, and DJI may go into a choppy sideway market while waiting for their problems to be solved.

Back to our KLSE, some of the counters that shows strong upward move amid the bearish time are MPHBWB, KIANJOO, CBSTECH, HARNLEN, KBES, and IE.

Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.

Update

On last Friday, the KLCI opened on fear as a result of DJI's fall of 33 points, the fear lasted for only a brief 5 minutes and the index quickly rebounded, showing good resilience and closed the day near the day's high at 1402.25, forming a hammer. The price action of the KLCI showed that the market is not in a state of great fear, and in fact, the smart-money were buying at the day's low, probably in preparation for a run later in the future. The immediate strong support of KLCI is found at the 1380 level. If this level can't hold, one may see the KLCI going down to test 1360. However, from the broader picture, our KLCI's uptrend is still very much intact.
The HSI was showing good support at the 28500 points level, the recent correction was a healthy one despite the hefty fall. I think our local investor must learn to get used to HSI's volatility. The longer term uptrend was intact.




The DJI was not looking good on the short term under the pressure of the subprime loan issue and the high oil price that is approaching USD100. From the chart, DJI had on last Friday closed below the long term 200 day's MA, the immediate support to keep the long term trend of the DJI intact is at the 12950 level, if this level is not defended, bye-bye, and sayonara DJI.


Back to our local market, the plantation sector was performing very well, some of the stocks that are worth watching are CEPAT and TDM. Other stocks like BHIC, TCHONG, JAKS and MPCorp, the uptrend are still intact.












Disclaimer: The above is not a recommendation to buy or sell, all suggestions mentioned are purely for academic study purposes for our trend trader club members only, and the author may have personal interest and position in some of the examples mentioned. Any losses incurred if you were to trade base on the study examples above is sole your own responsibility. Do consult your dealer before taking any action.